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Marg Ltd.

BSE: 530543 Sector: Infrastructure
NSE: MARG ISIN Code: INE941E01019
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OPEN 5.27
CLOSE 5.27
VOLUME 118436
52-Week high 8.52
52-Week low 5.15
P/E
Mkt Cap.(Rs cr) 27
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Marg Ltd. (MARG) - Director Report

Company director report

To

The Members MARG Limited

Your Directors are presenting the 25th Annual Report together with the FinancialStatements for the financial year ended 31st March 2020.

1. FINANCIAL RESULTS

Particulars Year Ended 31st March 2020 Year Ended 31st March 2019
Income from operations 0.85 18.38
Non-operating Income 27.57 3.72
Total income 28.42 22.55
Profit/(loss) before
Depreciation Finance Cost and Tax Expense (EBDIT) (6.40) (9.34)
Depreciation 6.83 8.24
Interest & Finance charges - 0.04
Profit/(Loss) before tax (13.23) (17.62)
Tax Expense
Current Tax NIL NIL
Deferred Tax NIL NIL
Profit/(Loss) after Tax (13.23) (17.62)
Balance in Profit & Loss Account (204.67) (187.10)
Amount available for appropriation (217.87) (204.67)
Dividend Nil Nil
Dividend tax Nil Nil
Amount transferred to
General Reserve Nil Nil
Balance in Profit and Loss
Account (217.87) (204.67)

During the Financial Year 2019-20 total revenue of the Company stands at Rs. 28.42Crores as against Rs. 22.55 Crores in the previous year. The EBDIT is (Rs. 6.40 Crores)compared to previous year of (Rs. 9.34 Crores). The Company incurred net loss of Rs. 13.23Crores during the financial year ended March 31 2020 as compared to net loss of Rs. 17.62Crores in the previous year. This is primarily due to slow down of operation lack of fundavailability projects depressed markets increase in cost of raw materials and labour.

2. DIVIDEND

Due to loss incurred by the Company your Directors have not recommended any dividendfor the financial year ended March 31 2020.

3. BUSINESS HIGHLIGHTS 2019-20

MARG Revenue Stands at Rs. 28.42 Crores in the Financial Year 2019-20.

4. DIRECTORS

The composition of the Board of Directors is in compliance with Regulation 17 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 and Section 149 of theCompanies Act 2013. Mr. Sreedhar Challa (DIN: 06468225) Independent Director of thecompany resigned w.e.f 14.02.2020. Mr. R Dinesh (DIN 00845119) continues as anIndependent Director of the company. Mrs. Elumalai Usha (DIN: 05303130) has been appointedas Independent Director on 12.11.2020.

5. MEETINGS

During the year under review the Board of Directors met 4 (Four) times* on October 92019 October 30 2019 November 14 2019 and February 14 2020.

In accordance with Clause VII of the Schedule IV of the Companies Act 2013 a separatemeeting of the Independent Directors of the Company was held on February 14 2020.

*on 28/05/2019 the NCLT Chennai passed an order admitting the petition filed by ICICIBank (Financial Creditor) and appointed an Interim Resolution Professional to oversee theactivities of the Company and the Board of Directors was put in suspension. Later theabove order was vacated by NCLAT by its order dated 30/09/2019.

6. ANNUAL EVALUATION BY THE BOARD

The Board has made a formal evaluation of its own performance and that of itscommittees and individual directors as required under section 134(3) (p) of the CompaniesAct 2013.

7. AUDIT RELATED MATTERS A. AUDITORS

The members of the Company at the 21st Annual General Meeting had appointed M/s. A RKrishnan & Associates. Chartered Accountants (Firm Registration No.009805S) Chennaias the Statutory Auditors of the Company to hold office from the conclusion of 21stAnnual General Meeting of the Company until the conclusion of the 26th Annual GeneralMeeting. The requirement to place the matter relating to appointment of Statutory Auditorsfor ratification by members at every Annual General Meeting is done away with videnotification dated May 7 2019 issued by the Ministry of corporate Affairs Government of

India. Accordingly no resolution is proposed for ratification of appointment ofStatutory Auditors who were appointed in the Annual General Meeting held on March 142017 for a period of 5 years.

The Statutory Auditors have confirmed that they are not disqualified to act as Auditorsand are eligible to hold office as Auditors of your Company.

B. SECRETARIAL AUDIT REPORT

The Board had appointed Mrs. Neha Agrawal Company Secretary in Whole-time Practice(Membership No. FCS 7707) as Secretarial Auditor for the financial year ended 31st March2020 to carry out the Secretarial Audit under the provisions of Section 204 of the Actread with the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. The report of the Secretarial Auditor is enclosed to this report as "AnnexureA".

C. COST AUDIT

The requirement to maintain cost accounting records and appointment of Cost Auditor inaccordance with the provisions of Companies (Cost Records and audit) Rules 2014 is notapplicable for the financial year 2019-20.

8. SUBSIDIARY COMPANIES STATUS

Your Company has total of 56 subsidiaries* as on 31st March 2020 out of which 4 Nonwholly-owned subsidiaries and 52 Wholly-owned subsidiaries including 25 Step-downSubsidiaries. There has been no material change in the nature of the business of theCompany and its subsidiaries. Details of major subsidiaries of the Company and theirbusiness operations during the year under review are covered in the Management Discussionand Analysis Report.

In accordance with Section 129(3) of the Act Consolidated Financial Statements of theCompany and all its subsidiaries forms part of the Annual Report. Further a statementcontaining the salient features of the financial statement of our subsidiaries in theprescribed format AOC - 1 is enclosed herewith as Annexure D to the Boards report. Thestatement also provides the details of performance and financial position of each of thesubsidiaries.

Subsidiary Companies' Monitoring Framework

All subsidiary companies are Board managed with their Boards having the rights andobligations to manage such companies in the best interest of their stakeholders. TheCompany monitors performance of subsidiary companies inter alia by the following means:Financial statements in particular investments made by unlisted subsidiary companies arereviewed quarterly by the Company's Audit Committee.

Minutes of Board meetings of unlisted subsidiary companies are placed before theCompany's Board regularly.

A statement containing all significant transactions and arrangements entered into byunlisted subsidiary companies is placed before the Company's Board.

Financial Position and Performance of Subsidiaries and Associates

In terms of Section 134 of the Companies Act 2013 and Rule 8(1) of the Companies(Accounts) Rules 2014 the financial position and performance of subsidiaries are givenas an Annexure to the Consolidated Financial Statements.

9. POLICY AND OTHER MATTERS A. Corporate Social Responsibility

The Company has constituted Corporate Social Responsibility Committee under the section135 of the Companies Act 2013 which is making exclusive progress in the field ofCorporate Social Responsibility and Societal interventions. The Committee is predominantlyinvolved in the areas of Women empowerment education health and hygiene community basedprograms including art music sports and other socio economic and cultural activities.

This Committee has been entrusted with the responsibility of formulating andrecommending to the Board a CSR policy from time to time broadly indicating theactivities to be undertaken by the company apart from the activities (already underprocessing) that are mandatory in the implementation of the frame work of CSR policy andrecommend the money to be spent on each of the activities as prescribed under Act and theRules made there under.

B. Code of Conduct

As prescribed under the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a declaration signed by the Chairman and Managing Director affirmingcompliance with the Code of Conduct by the Directors and senior management personnel ofthe Company for the financial year 2019-20 forms part of the Corporate Governance Report.

C. Declarations by Independent Directors

Pursuant to the provisions of sub-section (7) of Section 149 of the Companies Act2013 the Company has received individual declarations from all the Independent Directorsconfirming that they fulfill the criteria of independence as specified in Section 149(6)of the Companies Act 2013.

D. Extract of Annual Return

In terms of Section 134 of the Companies Act 2013 read with Rules 12(1) of theCompanies (Management and Administration) Rules 2014 the extract of the Annual Return ofthe Company for the financial year 2019-20 is provided in "Annexure B" to thisreport.

E. Particulars of Loans Guarantees and Investments

Particulars of Loans Guarantees and Investments in terms of Section 134 of theCompanies Act 2013 the particulars of loans guarantees and investments given by theCompany under Section 186 of the Companies Act 2013 is detailed in Notes to Accounts ofthe Standalone Financial Statements.

F. Related Party Transactions

All related party transactions that were entered into during the financial year were onan arm's length basis and all such contracts/arrangements/ transactions have been approvedby the Audit Committee.

10. GENERAL

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except ESOS referred to in this Report.

11. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF):

Pursuant to the provisions of the Companies Act 2013 dividends/fractions entitlementslying unclaimed for a period of 7 years from the date of their transfer tounpaid/unclaimed account have to be transferred to the Investor Education and ProtectionFund (IEPF) constituted and administrated by the Central Government. No claims lie againstthe IEPF or the Company after transfer. The details of unclaimed dividend are posted onthe website of the Company.

12. CORPORATE GOVERNANCE:

Your Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. The Corporate Governance Report approved bythe Board of Directors of the Company forms part of this report and a certificate issuedby Mrs. Neha Agrawal Practicing Company Secretary is set out in the Annexure to thisReport.

13. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis Report for the year under review forms part of thisannual report is provided in a separate section as stipulated under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

14. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS:

Your Company has taken adequate measures to conserve energy and the Company believesthat productivity from all its work-forces can be achieved with interface of latesttechnology.

Your Company is not an industrial undertaking in terms of Section 134(3)(m) of theCompanies Act 2013 read along with Companies Rule 8(3) of the Companies (Accounts) Rules2014 and hence particulars regarding conservation of energy technology absorption andadaptation are not applicable and hence the same are not provided.

There are no foreign exchange earnings and outgo during the financial year 2019-2020.

15. PARTICULARS OF EMPLOYEES U/S 197:

During the year there was no employee in receipt of remuneration as prescribed in theRule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. The prescribed particulars of Employees as required under Section 197 (12) of theAct read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is attached as "Annexure C" and form part of this Report.

However in accordance with the provisions contained in the proviso to Section 136(1)of the Companies Act 2013 the Annual Report and accounts excluding the aforesaidinformation are being sent to the shareholders of the Company. Any member interested inobtaining such particulars may write to the Company Secretary at the Registered Office ofthe Company for the same.

16. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the requirement under Section 134(5) of the Companies Act 2013 inrelation to the audited financial statements of the Company for the year ended March 312020 Your Directors hereby confirmed that

i. In the preparation of the Annual Accounts for the financial year ended 31st March2020 the applicable accounting standards has been followed and there were no materialdepartures;

ii. The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss account of the Company for the year.

iii. The directors have taken proper and sufficient care to the best of their knowledgeand ability for the maintenance of adequate accounting records in accordance with theprovisions of the Act for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;

iv. The directors have prepared annual accounts for the financial year ended 31st March2020 on a "going concern basis".

v. The directors have devised proper systems internal financial controls to befollowed by your Company and that such internal financial controls are adequate and havebeen operating effectively.

vi. The systems to ensure compliance with the provisions of all applicable laws are inplace and were adequate and operating effectively.

17. EXPLANATION OR COMMENTS BY THE BOARD ON EVERY QUALIFICATION RESERVATION OR ADVERSEREMARK OR DISCLAIMER BY THE STATUTORY AUDITORS & SECRETARIAL AUDITORS:

The Directors submit their explanation to the observations made by the Auditors intheir report for the FY 19-20. The relevant Para nos. of the report and reply are asunder:

REFER PARAGRAPH (BASIS OF QUALIFIED OPINION) OF THE AUDITOR'S REPORT ON STANDALONEFINANCIAL STATEMENTS:

(i) In respect to Note No. 28 to the audited financial statements of the year ended31st March 2020 regarding the providing interest for loans assigned to AssetReconstruction Company (ARCs) the management is of the opinion that since the company hasalready entered into proposal with ARC for converting debt to equity providing for theinterest shall not be viable.

(ii) In respect to Note No. 31-33 to the audited financial statements of the year ended31st March 2020 regarding the charging the interest on loans that are given toSubsidiaries the management hereby clarifies that Outstanding in Borrowings from BanksFinancials Institutions and ARC had become NPA due to this no interest is charged. Inrespect of loan receivable from Subsidiaries no interest is provided as subsidiariesunable to service loans and interest to its outstanding loans from bankers as it hasbecome NPA we continue not to provide Interest and burden the subsidiary companies.

(iii) In respect to Note No. 34(c) to the audited financial statements of the yearended 31st March 2020 regarding the EPC work in progress the Company hereby clarify thatthe work is going on which is not yet completed. Now Company is evaluating the workstatus and it will be billed shortly.

(iv) In respect to Note No. 35 to the audited financial statements of the year ended31st March 2020 regarding the investment in Karaikal Port Private Limited (KPPL) themanagement is workings towards reinstatement of Invoked shares in favour of MARG limitedwhereby shares held by Marg Limited in KPPL will be reinstated thereupon will be pledgedback to EARC. We have not given necessary effect to the investment value as postreinstatement Marg Limited will again hold Equity shares to the extent of 40.56% in KPPL.

(v) In respect to Note No. 36 regarding un-reconciled amount relating to the equipmentloan availed by the company. The reconciliation of the loan account is under process.Pending such reconciliation the management considers it appropriate to classify the sameunder "other advances'' in the Balance Sheet. Note 36 of the consolidated financialstatements is self explanatory.

(vi) In respect to balance confirmation Bank/ARCs as on 31st March 2020 themanagement hereby clarifies that regarding balances confirmation from Banks/ARCs. TheBalance Confirmation of the loan account from Balance/ARCs is under process and it will becompleted shortly.

(vii) In respect to Note No. 55 the regarding investment in "Future ParkingPrivate Limited"(FPPL). The management hereby clarifies that "Future ParkingPrivate Limited" is a joint venture entity MARG Limited continued to hold 51%shareholding in FPPL. Hence the same is treated as subsidiary and considered inconsolidation.

(viii) In respect of valuation of this investment in Karaikal Port Private Limited witha carrying value at cost of Rs.249.79 Crores the management hereby clarifies that untilrestructuring agreement implemented by KPPL there is no sanctity of valuation of sharesas of now and same will be done on post implementation of Master Restructuring Agreementby KPPL.

(ix) In respect of non-current investment in subsidiaries / step down subsidiariesaggregating to Rs. 317.13 Crore as at 31 March 2020 the management hereby clarifies thatsince the asset is not the continuity asset and as per the 12 A proposal Submitted by thecompany to NCLAT as settlement plan all the assets of the group companies which has beencollateralised to lenders which has to be liquidated as per the time frame given in theproposal which requires valuation process to be executed before liquidating the asset. Dueto this reasons It is not valued for the time being.

(x) In respect of Provision to be made towards the interest payable to MSMEs We feelthat since we are only settling for the value less than the principle to all stake holderdepending upon the financial situation adding any further liability without any realisticeffect does not have any effect hence not considered.

(xi) In respect of OTS Agreements please note that since the principle term loan (stepdown loans) is never routed through P & L any impact on the same will be only ongeneral reserves and hence recorded accordingly

REFER EMPHASIS OF MATTER OF THE AUDITORS' REPORT ON STANDALONE FINANCIAL STATEMENTS: a)In respect of preparing financial statements on ‘Going Concern' basis reference isdrawn to Note No. 30 which is self explanatory;

b) In respect to Note No. 31 to the audited financial statements of the year ended 31stMarch 2020 regarding the investment in New Chennai Township Private Limited themanagement hereby clarifies that the consolidated financials of Marg Group includesunaudited financials of New Chennai township Pvt ltd (NCTPL) for FY 1920 as they are underIRP. Like Marg Limited we are working towards moving NCTPL out of NCLT/NCLAT proceedingat the earliest.

c) In respect to Note No. 33(b) to the audited financial statements of the year ended31st March 2020 regarding the Arohi Infrastructure Private Limited (Arohi) themanagement hereby clarifies that even though TATA capital has lodged claim with Marg IRPin the capacity as guarantor Marg IRP rejected the claim as they have already lodgedtheir claim in Arohi which was accepted by Arohi IRP which is now under liquidationprocess. Inspite of that Marg limited has proposed settlement plan under 12A scheme whichis repayable over a period of one year based on the liquidation value of the collateralsoffered to Tata capital. We expect that Arohi to be out of liquidation process.

d) In respect of deductions made/amount withheld by some customers reference is drawnto Note No. 34 (a& b) which is self explanatory and the management is in the processof renegotiating/ necessary legal forum to recover the best possible way extent overcouple of years.;

e) In respect to Note No. 16 and 28(b) the regarding the settlement plan withEdelweiss Asset Reconstruction Company Ltd (EARC) the management hereby clarifies that inline with 12 A proposal submitted EARC has taken up the same for the committee approvalpost which Master Restructuring Agreement will be signed subject to the company satisfyingthe conditions precedent given in their initial in principal approval. The companyhowever complied with a conditions to in-principal approval and issued Equity shares ofthe extent of 24.99% to EARC converting part unsustainable portion of debt. However otherprecedent conditions are to be satisfied.

f) In respect to Note. 31 Phoenix ARC Private Limited The company has filed aresolution plan and is hopeful of getting a vacation order on the above admission order ofNCLT.

g) In respect to note 28(c) as the company is in the process of setting one timesettlement with all lenders COVID 19 impacted the investors sentiments initially howeverwe feel it would come on track as investor can never wait too long for their goldenopportunities arising out of this COVID 19.

REFER ANNEXURE-A TO THE AUDITOR'S REPORT ON STANDALONE FINANCIAL STATEMENTS:

Point 7(a) & 7(b) of Annexure A to Standalone Auditors' report: The delay in thepayment of Provident fund Employee's State Insurance Income Tax Wealth Tax CustomDuty Cess Sales Tax Service Tax and other material statutory dues were due to lowercash inflows from the existing projects and the company is arranging to make the paymentsshortly. Due to slow down in the Infrastructure and Real estate sector and the resultantimpact on the performance of your Company there were defaults in repayments of principleand interest dues to the Banks and Financial Institutions. However the management opinesthat with improved business scenario your Company will be able to meet its obligation.

REFER PARAGRAPH (QUALIFIED OPINION) OF ANNEXURE B TO THE AUDITOR'S REPORT ON STANDALONEFINANCIAL STATEMENTS:

The delay in updating the register of fixed assets and recording of expensestransactions met out of staff imprest advances are not intentional and the company hastaken necessary steps to update it as soon as possible.

REFER BASIS OF QUALIFIED OPINON OF THE AUDITORS' REPORT ON CONSOLIDATED FINANCIALSTATEMENTS:

(i) In respect to Note No. 30 to the audited financial statements of the year ended31st March 2020 regarding the providing interest for loans assigned to AssetReconstruction Company (ARCs) the management is of the opinion that it is not viable tofollow the pattern of providing the interest towards loans which are NPA status and laterrespective Banks assigned it to ARCs.

(ii) In respect to Note No. 36 to the audited financial statements of the year ended31st March 2020 regarding the EPC work in progress the Company hereby clarify that thework is going on which is not yet completed. Now Company is evaluating the work statusand it will be billed shortly. Further regarding the management fees the company wasreceiving earlier the said fees now due to some dispute but the Company is confident toreceive the amount.

(iii) In respect to Note No. 37 to the audited financial statements of the year ended31st March 2020 regarding the investment in Karaikal Port Private Limited (KPPL) theManagement is workings towards reinstatement of Invoked shares in favour of MARG limitedwhereby shares held by Marg Limited in KPPL will be reinstated thereupon will be pledgedback to EARC. We have not given necessary effect to the investment value as postreinstatement Marg Limited will again hold Equity shares to the extent of 40.56% in KPPL.

(iv) In respect to Note No. 38 the regarding un-reconciled amount relating to theequipment loan availed by the company. The reconciliation of the loan account is underprocess. Pending such reconciliation the management considers it appropriate to classifythe same under "other advances'' in the Balance Sheet. Note 38 of the consolidatedfinancial statements is self explanatory.

(v) In respect to the matter regarding investment in "Future Parking PrivateLimited"(FPPL). The management hereby clarifies that "Future Parking PrivateLimited" is a joint venture entity MARG Limited continued to hold 51% shareholdingin FPPL. Hence the same is treated as subsidiary and considered in consolidation.

(vi) In respect to balance confirmation Bank/ARCs as on 31st March 2020 themanagement hereby clarifies that the regarding balances confirmation from Banks/ARCs. TheBalance Confirmation of the loan account from Balance/ARCs is under process and it will becompleted shortly.

(vii) In respect of valuation of this investment in Karaikal Port Private Limited witha carrying value at cost of Rs.249.79 Crores the management hereby clarifies that untilrestructuring agreement implemented by KPPL there is no sanctity of valuation of sharesas of now and same will be done on post implementation of Master Restructuring Agreementby KPPL.

(viii) In respect of M/s. Mukta Infrastructure Private Limited the respective companyis of opinion that price of land shall appreciate in future and hence no provision forimpairment loss is made.

(ix) In respect of M/s. Arohi Infrastructure Private Limited the debenture holder hasnot exercised the Put option during the FY 2014-15 hence the respective company has notprovided any premium on redemption during the FY 2019-20.

(x) In respect of M/s. Riverside Infrastructure (India) Private Limited the managementis taking efforts for resuming the Mall Project and is in discussion with strategicpartners for this purpose. Further considering the latest valuation of the property ofthe Company the management considers it appropriate to capitalize the other expenses ofRs. 0.82 Crores (PY Rs. 2.26 Crores) during the year ended 31st March 2020. (xi) Inrespect to the matter of Non Audit of certain Subsidiary Companies and associate Companythe management hereby clarifies that those subsidiary Companies and associate companieshave been duly audited by the Statutory Auditors but the Company is yet to receive theaudited balance sheets along with auditor's report from the Auditor.

(xii) In respect of qualifications pertaining to obtaining balance confirmation w.r.tMarg Properties Limited Riverside Infrastructure (India) Private LimitedSarangInfradevelopers Private Limited and Magnumopus Infradevelopers Private Limitedplease note we are in the process of implementing one time settlement with all stakeholders hence confirmation of balance does not impact as in reaility these may be closedfor a realistic value equivalent the value of the collaterla offered to such stake holder.regarding customers once apartments are delivered the same will closed by transfferringfrom respective CWIP

(xiii) In respect to balance confirmation Bank/ARCs as on 31st March 2020 for foursubsidiaries the management hereby clarifies that the regarding balances confirmationfrom Banks/ARCs. The Balance Confirmation of the loan account from Balance/ARCs is underprocess and it will be completed shortly.

REFER EMPHASIS OF MATTER OF THE AUDITORS' REPORT ON CONSOLIDATED FINANCIAL STATEMENTS:

a) In respect of preparing financial statements on ‘Going Concern' basis referenceis drawn to Note No. 32 which is self explanatory;

b) In respect of Property of the Subsidiary Companies provided security for variousloans reference is drawn to Note No. 33 which is self explanatory;

c) In respect of the Investments in and Advances receivable due from some of itsSubsidiaries Companies reference is drawn to Note No. 34 which is self explanatory;

d) In respect to Note No. 2 the regarding the settlement plan with Edelweiss AssetReconstruction Company Ltd (EARC) the management hereby clarifies that in line with 12 Aproposal submitted EARC has taken up the same for the committee approval post whichMaster Restructuring Agreement will be signed subject to the company satisfying theconditions precedent given in their initial in principal approval. The company howevercomplied with a conditions to inprincipal approval and issued Equity shares of the extentof 24.99% to EARC converting part unsustainable portion of debt. However other precedentconditions are to be satisfied.

e) In respect to Note No. 33(5) (a) to the audited financial statements of the yearended 31st March 2020 regarding the Aro-hi Infrastructure Private Limited (Arohi) themanagement hereby clarifies that even though TATA capital has lodged claim with Marg IRPin the capacity as guarantor Marg IRP rejected the claim as they have already lodgedtheir claim in Arohi which was accepted by Arohi IRP which is now under liquidationprocess. Inspite of that Marg limited has proposed settlement plan under 12A scheme whichis repayable over a period of one year based on the liquidation value of the collateralsoffered to Tata capital. We expect that Arohi to be out of liquidation process.

f) In respect to Note No. 32 (II) to the audited financial statements of the year ended31st March 2020 regarding the investment in New Chennai Township Private Limited themanagement hereby clarifies that the consolidated financials of Marg Group includesunaudited financials of New Chennai township Pvt ltd (NCTPL) for FY 1920 as they are underIRP. Like Marg Limited we are working towards moving NCTPL out of NCLT/NCLAT proceedingat the earliest.

g) In respect to Note No. 32 (V) to the audited financial statements of the year ended31st March 2020 regarding the investment in Marg Trading Pte Ltd the management isworking on to remove the deregistration of Marg trading in ACRA. This does affect therecoverability of Investment Value and advances.

h) In respect of deductions made/amount withheld by some customers reference is drawnto Note No. 41 which is self explanatory;

i) In respect of case filed in Tamilnadu Real Estate Regulation Authority (TNRERA)against Marg Properties Limited please note company has already formed the customerassociation and opened escrow account to ensure the project completion is assured as eachand every penny of customer remittance will only be used for project completion hence wefeel those opted for refund also take up the flat on completion of the project

j) In respect to note 30(c) regarding COVID 19 as we are in the process of setting onetime settlement with all lenders this COVID19 impacted the investors sentimentsinitially however we feel it would come on track as investor can never wait too long fortheir golden opportunities arising out of this COVID 19.

18. FIXED DEPOSITS

During the year under review your Company has not invited or accepted fixed depositsfrom the public.

19. EMPLOYEE RELATIONS

The Directors place on record their deep sense of appreciation for the committedservices by the executives staff and workers of the Company at all levels to meet thecompany's objectives. The employee relations at all projects and other locations continueto be cordial.

20. BUILDING A STRONG CUSTOMER CONNECT

Customer intimacy is one of your Company's strategic priorities to reach its ambitionof being the leading reference in Infrastructure and Real Estate.

21. VIGIL MECHANISM

The Company has adopted a Whistle Blower Policy to provide a formal vigil mechanism tothe Directors and employees to report their concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policyprovides for adequate safeguards against victimization of employees who avail of themechanism and also provides for direct access to the Chairperson of the Audit Committee.It is affirmed that no personnel of the Company has been denied access to the AuditCommittee.

22. REPORTING OF FRAUD

There have been no instances of fraud reported by the Auditors under section 143 (12)of the Companies Act 2013 and rules made thereunder either to the Company or to theCentral Government.

ACKNOWLEDGEMENT

The Board expresses its deepest appreciation and gratitude for the guidance andcooperation extended to the Company by our customers vendors investors Bankersemployees Statutory Authorities and Regulators. We place on record our specialappreciation of the contribution made by our employees at all the levels and look forwardto their continued support in the future.

For and on behalf of the Board of Directors

G R K Reddy

Chairman & Managing Director

Place: Chennai

Date: 29th June 2020